Account holders of these 16 banks to get Rs 5 lakh benefits, know details

There is good news for the customers of 16 Co-Operative Banks. The customers of these banks will get benefits worth Rs 5 lakh. This amount is being distributed in the form of a deposit insurance cover scheme. Under a new law related to Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of Reserve Bank of India (RBI), customers of these banks will get insurance cover.

As per news agency PTI, the Deposit Insurance and Credit Guarantee Corporation (DICGC) had earlier prepared a list of 21 banks for this. But five other co-operative banks, including Punjab and Maharashtra Co-operative Bank, were excluded from the list after going through the resolution process. The Parliament had passed the Deposit Insurance and Credit Guarantee Corporation (Amendment) Bill, 2021, which aims to ensure that account holders get Rs 5 lakh within 90 days of the RBI's ban on banks.

The Deposit Insurance and Credit Guarantee Corporation (DICGC) had earlier prepared a list of 21 banks but five, including Punjab & Maharashtra Co-Operative Bank (PMC Bank), are out of the list as they are either in merger process or out of the moratorium.

Parliament in August passed the Deposit Insurance and Credit Guarantee Corporation (Amendment) Bill, 2021 ensuring that account holders get up to Rs 5 lakh within 90 days of the RBI imposing a moratorium on the banks.

Following enactment, the government has notified September 1, 2021 as the date on which the provisions of the Act would come into force. The mandated 90 days from the notified date comes to an end on November 29, 2021.

The depositors of these banks, who have not yet submitted their claims, are advised to contact the respective banks, a public notice from DICGC said.

"The claims should be supported by officially valid documents of identity and written consent to receive the amount lying in credit of their deposit account (willingness declaration) subject to a maximum of Rs 5 lakh along with alternate bank account details into which the said amount may be credited," it said.

Last year, the government increased the insurance cover on deposits by five times to Rs 5 lakh. The enhanced deposit insurance cover of Rs 5 lakh came into effect from February 4, 2020.

Every bank used to pay 10 paise as an insurance premium per Rs 100 of deposit. It was raised to 12 paise per Rs 100 in 2020. It cannot be more than 15 paise at any point in time per Rs 100 deposit.

It is to be noted that the enhanced deposit insurance cover of Rs 5 lakh is effective from February 4, 2020. The increase was done after a gap of 27 years as it has been static since 1993.

(With PTI inputs)